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June 27, 2025 |
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(as revised October 31, 2025) |
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Summary Prospectus |
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iShares ESG Advanced Universal USD Bond ETF | EUSB | NYSE Arca
Before you
invest, you may want to review the Fund’s prospectus, which contains more information about the Fund and its risks. You can find the Fund’s prospectus
(including amendments and supplements) and other information about the Fund, including the Fund’s statement of additional information and shareholder reports, online at https://www.blackrock.com/prospectus. You can also get this information at no cost by calling 1-800-iShares (1-800-474-2737) or by sending an e-mail request to
iSharesETFs@blackrock.com, or from your financial professional. The Fund’s prospectus and statement of additional information, both dated June 27, 2025, as amended and supplemented from time to time, are incorporated by reference into (legally made a part of) this Summary Prospectus. Information on the Fund’s net asset value, market price, premiums and discounts, and bid-ask spreads can be found at
https://www.iShares.com.
The Securities and Exchange Commission has not approved or disapproved these securities or passed
upon the adequacy of this prospectus. Any representation to the contrary is a criminal offense.
iSHARES® ESG ADVANCED UNIVERSAL USD BOND ETF
Ticker: EUSBStock Exchange: NYSE Arca
Investment Objective
The iShares ESG Advanced Universal USD Bond ETF (the “Fund”) seeks to track the investment
results of an index composed of U.S. dollar-denominated bonds that are rated either investment-grade or high-yield from issuers with a favorable environmental, social and governance rating as identified by the index provider, while applying extensive screens for involvement in controversial activities.
Fees and Expenses
The following table describes the fees and expenses that you will incur if you buy, hold
and sell shares of the Fund. The investment advisory agreement between iShares Trust (the “Trust”) and BlackRock Fund Advisors
(“BFA”) (the “Investment Advisory
Agreement”) provides that BFA
will pay all operating expenses of the Fund, except: (i) the management fees, (ii) interest expenses, (iii) taxes, (iv) expenses incurred with respect to the acquisition and
disposition of portfolio securities and the execution of portfolio transactions, including brokerage commissions, (v) distribution fees or expenses, and (vi) litigation expenses
and any extraordinary expenses.
The Fund may incur “Acquired Fund Fees and
Expenses.” Acquired Fund Fees and Expenses reflect the Fund’s pro rata share of the fees
and expenses incurred indirectly by the Fund as a result of investing in other investment companies. The impact of Acquired Fund Fees and Expenses is included in the Fund’s total return but is not included in the Fund’s ratio of expenses to average net assets. Both figures are shown in the Financial Highlights section of the Fund’s prospectus (the “Prospectus”). BFA, the investment
adviser to the Fund, has contractually agreed to waive a portion of its management fees in an amount equal to the Acquired Fund Fees and Expenses, if any, attributable to investments by the Fund in other registered investment companies advised by BFA, or its affiliates, through June 30, 2030. The contractual waiver may be terminated prior to June 30, 2030 only upon written agreement of the Trust and BFA.
You may pay other fees, such as brokerage commissions and other fees to
financial intermediaries, which are not reflected in the tables and examples below.
1Operating expenses paid by BFA under the Investment Advisory Agreement exclude Acquired Fund Fees and Expenses, if any.
2The amount rounded to 0.00%.
Example. This Example is intended to help you compare the cost of owning shares of the Fund with the
cost of investing in other funds. The Example assumes that you invest $10,000 in the Fund for the time periods indicated and then sell all of your shares at the end of those
periods. The Example also assumes that your investment has a 5% return each year and that the Fund’s operating expenses remain the same. Although your actual costs may be higher or lower, based on these assumptions, your costs would be:
| 1
Year |
3
Years |
5
Years |
10
Years |
| $12 |
$39 |
$68 |
$154 |
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Portfolio Turnover. The Fund may pay transaction costs, such as commissions, when it buys and sells securities (or “turns over” its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when Fund shares are held in a taxable account. These costs, which are
not reflected in the Annual Fund Operating Expenses or in the Example, affect the Fund’s performance.
During the most recent fiscal year, the Fund's portfolio turnover rate was 100% of the average value of its
portfolio.
Principal Investment Strategies
The Fund seeks to track the investments results of the Bloomberg MSCI US Universal Choice ESG Screened Index (the “Underlying Index”), which has been developed by Bloomberg Finance L.P. and its affiliates (the “Index Provider” or “Bloomberg”) with environmental, social and
governance (“ESG”) rating inputs from MSCI ESG Research LLC
(“MSCI ESG
Research”) pursuant to an
agreement between MSCI ESG Research and Bloomberg Index Services Limited (a subsidiary of Bloomberg) or an
affiliate. The Underlying Index is a modified market value-weighted index designed to reflect the
performance of U.S. dollar-denominated, taxable bonds with favorable ESG ratings (as determined by MSCI ESG
Research) while applying extensive screens, including, for example, a screen which focuses on removing fossil fuel exposure. To construct the Underlying Index, Bloomberg begins with the Bloomberg U.S. Universal Index (the “Parent Index”). The Parent Index includes securities with at least one year until final maturity, without regard to optionality features such as call provisions or conversion provisions. The Parent Index
includes Treasury securities, government-related securities (i.e., U.S. and non-U.S. agency debt securities, and non-U.S. sovereign, quasi-sovereign, supranational and local authority debt), investment-grade and high yield (as well as unrated) corporate bonds, U.S.
agency mortgage-backed pass-through securities (“MBS”), commercial mortgage-backed securities, asset backed securities, Eurodollar bonds, bonds registered with the SEC or
exempt from registration at the time of issuance or offered pursuant to Rule 144A with or without
registration rights and U.S. dollar-denominated emerging market bonds.
From the Parent Index, Bloomberg excludes issuers with unfavorable ESG ratings, as
calculated by MSCI ESG Research, and then further excludes securities of issuers involved in adult
entertainment, alcohol, gambling, tobacco, genetic engineering, controversial weapons, nuclear weapons,
civilian firearms, conventional weapons, palm oil, private prisons, predatory lending, and nuclear power
based on revenue or percentage of revenue thresholds for certain categories (e.g., $500 million or 50%) and categorical exclusions for others (e.g., nuclear weapons).
Bloomberg screens companies with involvement in fossil fuels by excluding any company in the Bloomberg energy
sector and all companies with an industry tie to fossil fuels such as thermal coal, oil and gas—in
particular, reserve ownership, related revenues and power generation. Additionally, Bloomberg excludes
companies involved in very serious business controversies.
For each industry, MSCI ESG Research identifies key ESG issues that can lead to unexpected costs for entities in the
medium- to long-term (e.g., climate change, resource scarcity, demographic shifts). MSCI ESG Research then calculates the size of each
entity's
exposure to each key issue based on the entity's business segment and geographic risk and analyzes the extent to which such entities have developed robust strategies and programs to manage ESG risks and opportunities. MSCI ESG Research
scores entities based on both their risk exposure and risk management. To score well on a key issue, MSCI
ESG Research assesses management practices, management performance (through demonstrated track record and
other quantitative performance indicators), governance structures, and/or implications in controversies,
which all may be taken as a proxy for overall management quality. Controversies, including, among other
things, issues involving anti-competitive practices, toxic emissions and waste, and health and safety,
occurring within the last three years lead to a deduction from the overall management score on each issue.
Using a sector-specific key issue weighting model, entities are rated and ranked in comparison to their
industry peers. Key issues and weights are reviewed at the end of each calendar year. Corporate governance
is always weighted and analyzed for all entities. As of February 28, 2025, a significant portion of the
Underlying Index is represented by U.S. agency MBS and U.S. Treasury bonds. The components of the Underlying
Index are likely to change over time. The securities in the Underlying Index are updated on the last
business day of each month.
BFA uses an indexing approach to try to achieve the Fund’s investment objective. The Fund does not try to “beat” the index it tracks and does not seek temporary defensive positions when markets decline or appear overvalued.
Indexing may eliminate the chance that the Fund will substantially outperform the Underlying Index but also may reduce
some of the risks of active management, such as poor security selection. Indexing seeks to achieve lower
costs and better after-tax performance by aiming to keep portfolio turnover low in comparison to actively
managed investment companies.
BFA uses a representative sampling
indexing strategy to manage the Fund. “Representative sampling” is an indexing
strategy that involves investing in a representative sample of securities that collectively has an
investment profile similar to that of an applicable underlying index. The securities selected are expected
to have, in the aggregate, investment characteristics (based on factors such as market value and industry
weightings), fundamental characteristics (such as return variability, duration (i.e., a security's price sensitivity to a change in interest rates), maturity or credit ratings and yield) and liquidity measures similar to those of an applicable underlying index. The
Fund may or may not hold all of the securities in the Underlying Index.
The Fund will invest at least 80% of its assets in the component securities of the
Underlying Index and in investments that have economic characteristics that are substantially identical to the component securities of the Underlying Index (i.e., TBAs), and the Fund will invest at least 90% of its assets in fixed income securities of the types included in the Underlying Index that BFA believes will help the Fund track the Underlying
Index. The Fund will invest no more than 10% of its assets in futures, options, and swaps contracts that
BFA believes will help the Fund track the Underlying Index as well as in fixed income securities other than
the types included in the Underlying Index, but which BFA believes will help the Fund track the Underlying
Index. Cash and cash
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equivalent investments associated with a
derivative position will be treated as part of that position for the purposes of calculating the percentage
of investments included in the Underlying Index. The Fund seeks to track the investment results of the Underlying Index before fees and expenses of the Fund.
The Fund may lend securities representing up to one-third of the value of the Fund's total assets (including the value
of any collateral received).
The Underlying Index is sponsored by Bloomberg, MSCI ESG Research or their affiliates, which are independent of the Fund
and BFA, pursuant to an agreement between MSCI ESG Research and Bloomberg Index Services Limited (a
subsidiary of Bloomberg) or an affiliate. The Index Provider determines the composition and relative
weightings of the securities in the Underlying Index and publishes information regarding the market value
of the Underlying Index.
Industry Concentration
Policy. The Fund will concentrate its investments (i.e., hold 25% or more of its total assets) in a particular industry or group of industries to approximately the same extent that the Underlying Index is concentrated.
For purposes of this limitation, securities of the U.S. government (including its agencies and
instrumentalities), repurchase agreements collateralized by U.S. government securities, and securities of
state or municipal governments and their political subdivisions are not considered to be issued by members of any industry.
Summary of Principal Risks
As with any investment, you could lose all or part of your investment in the Fund, and the Fund's performance could
trail that of other investments. The Fund is subject to certain risks, including the principal risks noted
below any of which may adversely affect the Fund's net asset value per share (“NAV”), trading price, yield, total return and ability to meet its investment objective. Certain key risks are prioritized below
(with others following in alphabetical order), but the relative significance of any risk is difficult to
predict and may change over time. You should review each risk factor carefully.
Credit Risk. Credit risk is the risk that an issuer, guarantor or liquidity provider of a fixed-income security may be unable or
unwilling, or may be perceived as unable or unwilling, to make timely principal and/or interest payments or
to otherwise honor its obligations. The credit rating assigned to a security or its issuer does not
necessarily reflect the issuer’s current financial condition or an investment’s volatility or liquidity. An actual or perceived decline in an issuer’s creditworthiness may result in a decrease in the value and liquidity of its
securities as well as greater price volatility, which may make it difficult to sell the securities. The
Fund may be adversely affected if an investment that it holds experiences a downgrade or a default.
Income Risk. The Fund’s income may decline due to falling interest rates or other factors. This can occur because the Fund
may be required to invest in lower-yielding bonds when a bond in the Fund’s portfolio matures, is
near maturity, is called or is prepaid, when bonds in the Underlying Index are substituted, or when the
Fund otherwise needs to purchase additional bonds. The Index Provider’s substitution of bonds in the Underlying Index may
occur, for example, when the time to
maturity for the bond no longer matches the Underlying Index’s stated maturity guidelines.
ESG Risk. To the extent that the Underlying Index
uses criteria related to the ESG characteristics of issuers, this may limit the types and number of
investment opportunities available to the Fund and, as a result, the Fund may underperform other funds
whose underlying index does not use ESG criteria. The Underlying Index’s use of ESG criteria may
result in the Fund investing in, or allocating greater weight to, securities or market sectors that
underperform the market as a whole or underperform other funds that use ESG criteria. In addition, the use
of representative sampling may result in divergence of the Fund’s overall ESG characteristics or ESG
risk from those of the Underlying Index. The Index Provider may evaluate security-level ESG data and, if
applicable, ESG objectives or constraints that are relevant to the Underlying Index only at index reviews
or rebalances. Securities included in the Underlying Index may cease to meet the relevant ESG criteria but
may nevertheless remain in the Underlying Index and the Fund until the next review or rebalance by the Index
Provider. As a result, certain securities in the Underlying Index, or the Underlying Index as a whole, may
not meet the relevant ESG objectives or constraints at all times.
Market Risk. The Fund could lose money over short periods due to short-term market movements and over longer periods during more prolonged market downturns. Local, regional or global events such as war, acts of terrorism, pandemics or other
public health issues, recessions, the prospect or occurrence of a sovereign default or other financial
crisis, or other events could have a significant impact on the Fund and its investments and could
result in increased premiums or discounts to the Fund’s NAV.
Index-Related Risk. The Index Provider may rely on
various sources of information to assess the criteria of components of the Underlying Index, including
information that may be based on assumptions and estimates. Neither the Fund nor BFA can offer assurances
that the Index Provider’s methodology or sources of information will provide an accurate assessment of included components or will result in the Fund meeting its investment objective. Errors in index data, index computations or the
construction of the Underlying Index in accordance with its methodology may occur, and the Index Provider
may not identify or correct them promptly or at all, which may have an adverse impact on the Fund and its
shareholders. Unusual market conditions or other unforeseen circumstances (such as natural disasters,
political unrest or war) may impact the Index Provider or a third-party data provider and could cause the Index Provider to postpone a scheduled rebalance. This could cause the Underlying Index to vary from its normal or expected
composition.
Asset Class
Risk. The securities and other assets in the Underlying Index or in the Fund’s portfolio may
underperform in comparison to financial markets generally, a particular financial market, another index, or
other asset classes.
Authorized
Participant Concentration Risk. An “Authorized Participant” is a member or participant of a clearing agency registered with the SEC, which has a written agreement with the Fund or one of its service providers that allows the Authorized Participant to place orders for the purchase and
redemption of creation units
(“Creation Units”). Only an Authorized Participant
S-3
may engage in creation or redemption
transactions directly with the Fund. There are a limited number of institutions that may act as Authorized
Participants for the Fund, including on an agency basis on behalf of other market participants. No Authorized
Participant is obligated to engage in creation or redemption transactions. To the extent that Authorized
Participants exit the business or do not place creation or redemption orders for the Fund and no other
Authorized Participant places orders, Fund shares are more likely to trade at a premium or discount to NAV
and possibly face trading halts or delisting.
Call Risk. During periods of falling interest rates, an issuer of a callable bond held by the Fund may “call” or repay the security before its stated maturity, and the Fund may have to reinvest the proceeds in securities with lower yields, which would result in a decline in the Fund's income, or in securities with
greater risks or with other less favorable features.
Concentration Risk. The Fund may be susceptible to an increased risk of loss, including losses due to adverse events that affect the Fund’s investments more than the
market as a whole, to the extent that the Fund’s investments are concentrated in the securities or
other assets of one or more issuers, countries or other geographic units, markets, industries, project types, or asset classes.
Extension Risk. During periods of rising interest rates, certain debt obligations may be paid off substantially more slowly than originally anticipated and the value of those securities
may fall sharply, resulting in a decline in the Fund’s income and potentially in the value of the
Fund’s investments.
High
Portfolio Turnover Risk. High portfolio turnover is considered by the Fund to mean turnover of greater than
100% annually. Portfolio turnover (i.e., the sale of securities or other assets and reinvestment in other securities or assets) generally involves transaction costs to the Fund, including brokerage commissions, dealer mark-ups and other costs. In addition,
the sale of securities by the Fund may result in the realization of taxable capital gains, including
short-term capital gains. Higher portfolio turnover may cause the Fund to incur additional transaction
costs, which have the effect of reducing the Fund’s investment return, and may result in different tax consequences for shareholders compared to a fund with lower portfolio turnover.
Interest Rate Risk. Interest rate risk refers to the risk of fluctuations in the value of a fixed-income security due to changes in the general level of interest rates. Interest rate changes can be sudden and unpredictable and are influenced by a
number of factors, including government policy, monetary policy, inflation expectations, perceptions of
risk, and supply and demand for fixed-income securities. An increase in interest rates generally will cause
the value of fixed-income securities to decline. Securities with longer maturities generally are more sensitive to interest rate changes and subject to greater fluctuations in value. Changes in interest rates may have unpredictable effects on
fixed-income markets and result in heightened volatility and lower liquidity for certain instruments, which
may adversely affect a Fund’s performance. During periods of very low or negative interest rates, a
Fund may be unable to maintain positive returns or pay dividends to shareholders.
Issuer
Risk. The performance of the Fund depends on the performance of individual securities or other assets to which the Fund has exposure. The value of securities or other
assets may decline, or perform differently from the market as a whole, due to changes in the financial
condition or credit rating of the issuer or counterparty.
Large Shareholder and Large-Scale Redemption Risk. Certain shareholders of the Fund, including an Authorized Participant, a third-party investor, the Fund’s adviser, an
affiliate of the Fund’s adviser, a market maker, or another entity, may from time to time own or
manage a substantial amount of Fund shares, or may hold their investment in the Fund for a limited period of time. There can be no assurance that any large shareholder or large group of shareholders would not redeem their investment. Redemptions
of a large number of Fund shares could require the Fund to dispose of assets to meet the redemption
requests, which can accelerate the realization of taxable income and/or capital gains and cause the Fund to
make taxable distributions to its shareholders earlier than the Fund otherwise would have. In addition, under certain circumstances, non-redeeming shareholders may be treated as receiving a disproportionately large taxable distribution
during or with respect to such year. In some circumstances, the Fund may hold a relatively large proportion
of its assets in cash in anticipation of large redemptions, diluting its investment returns. These large
redemptions may also force the Fund to sell portfolio securities or other assets when it might not otherwise do so, which may negatively impact the Fund’s NAV, increase the Fund’s brokerage costs and/or have a material
effect on the market price of Fund shares.
Management Risk. The Fund generally does not attempt to take defensive positions under any market conditions, including declining markets. As the Fund will not fully replicate the Underlying Index and may hold securities or other assets not
included in the Underlying Index, it is subject to the risk that the investment strategy of BFA may not
produce the intended results. There is no guarantee that the Fund’s investment results will have a
high degree of correlation to those of the Underlying Index or that the Fund will achieve its investment objective.
Market Trading Risk. The Fund faces numerous market trading risks, including the potential lack of an active market for Fund shares (including through a trading halt), losses from
trading in secondary markets, periods of high volatility, and disruptions in the process of creating and
redeeming Fund shares. Any of these factors, among others, may lead to the Fund’s shares trading in
the secondary market at a premium or discount to NAV or to the intraday value of the Fund’s portfolio
holdings. If you buy Fund shares at a time when the market price is at a premium to NAV or sell Fund shares
at a time when the market price is at a discount to NAV, you may pay significantly more or receive significantly less than the underlying value of the Fund shares.
Operational and Technology Risks. The Fund is directly and indirectly susceptible to operational and technology risks, including those related to human errors, processing errors, communication errors, systems failures, cybersecurity
incidents, and the use of artificial intelligence and machine learning (“AI”), which may result in losses for the Fund and its shareholders or may impair the Fund’s operations. While the
Fund’s service providers are required to have appropriate operational,
S-4
information security and cybersecurity risk
management policies and procedures, their methods of risk management may differ from those of the Fund.
Operational and technology risks for the issuers in which the Fund invests could also result in material
adverse consequences for such issuers and may cause the Fund’s investments in such issuers to lose
value.
Prepayment Risk. During periods of falling interest rates, issuers of certain debt obligations may repay principal prior to the security’s maturity, which may cause the Fund to have to reinvest in securities with lower yields or higher risk
of default, resulting in a decline in the Fund’s income or return potential.
Risk of Investing in China.
Investments in Chinese securities, including certain Hong Kong-listed and U.S.-listed securities, subject the Fund to risks specific to China. China may be subject to considerable degrees of economic, political and
social instability. China is an emerging market and demonstrates significantly higher volatility from time
to time in comparison to developed markets. Over the last few decades, the Chinese government has
undertaken reform of economic and market practices and has expanded the sphere of private ownership of
property in China. However, Chinese markets generally continue to experience inefficiency, volatility and
pricing anomalies resulting from governmental influence, a lack of publicly available information and/or
political and social instability. Chinese companies are also subject to the risk that Chinese authorities
can intervene in their operations and structure. Internal social unrest or confrontations with neighboring
countries, including military conflicts in response to such events, may also disrupt economic development
in China and result in a greater risk of currency fluctuations, currency non-convertibility, interest rate
fluctuations and higher rates of inflation.
China has experienced security concerns, such as terrorism and strained international relations. Additionally,
China is alleged to have participated in state-sponsored cyberattacks against foreign companies and foreign
governments. Actual and threatened responses to such activity and strained international relations,
including purchasing restrictions, sanctions, tariffs or cyberattacks on the Chinese government or Chinese
companies, may impact China’s economy and Chinese issuers of securities in which the Fund invests.
Incidents involving China's or the region's security may cause uncertainty in Chinese markets and may
adversely affect the Chinese economy and the Fund's investments. Export growth continues to be a major
driver of China's rapid economic growth. Reduction in spending on Chinese products and services, supply
chain diversification, institution of additional tariffs or other trade barriers (including as a result of
heightened trade tensions or a trade war between China and the U.S. or in response to actual or alleged
Chinese cyber activity) or a downturn in any of the economies of China's key trading partners may have an
adverse impact on the Chinese economy. The Underlying Index may include companies that are subject to
economic or trade restrictions (but not investment restrictions) imposed by the U.S. or other governments
due to national security, human rights or other concerns of such government. So long as these restrictions
do not include restrictions on investments, the Fund is generally expected to invest in such companies,
consistent with its objective to track the performance of the Underlying Index.
Chinese companies, including Chinese
companies that are listed on U.S. exchanges, are not subject to the same degree of regulatory requirements,
accounting standards or auditor oversight as companies in more developed countries. As a result,
information about Chinese securities in which the Fund invests may be less reliable or complete. Chinese
companies with securities listed on U.S. exchanges may be delisted if they do not meet U.S. accounting
standards and auditor oversight requirements, which would significantly decrease the liquidity and value of
the securities. There may be significant obstacles to obtaining information necessary for investigations into or litigation against Chinese companies, and investors may have limited legal remedies. The Fund does not select
investments based on investor protection considerations.
Risk of Investing in the China Bond Market. The Fund invests directly in the domestic bond market in the People’s Republic of China (“China” or the “PRC”) (the “China Interbank Bond Market”) through the Bond Connect trading channel. All bonds traded through Bond Connect are registered in the name of the
PRC’s Central Moneymarkets Unit (“CMU”), which holds such bonds as a nominee owner. The precise nature and rights of the Fund as the beneficial owner of bonds traded in the China Interbank
Bond Market through CMU as nominee are relatively new and untested areas of PRC law, and the exact nature
of the Fund’s remedies and methods of enforcement of its rights and interests under PRC law are
uncertain.
Market volatility and potential lack of liquidity due to
low trading volume of certain bonds in the China Interbank Bond Market may result in the prices of certain
bonds fluctuating significantly. Also, the systems used to trade through Bond Connect may not function as
expected. Trading through Bond Connect is also subject to regulatory risks, including laws and regulations that are subject to change. There can be no assurance that Bond Connect or its features or systems will not be materially
altered, suspended, discontinued or abolished. The Fund may be subject to additional taxation if certain
tax exemptions under PRC tax regulations are withdrawn or amended. Any taxes arising from or to the Fund
may be directly borne by, or indirectly passed on to, the Fund, which may substantially impact its NAV. Investing through Bond Connect subjects the Fund to currency risk, to the extent that currency rates used for Bond Connect are
different than the rates used in the China Interbank Bond Market.
Risk of Investing in Russia. Investing in Russian
securities involves significant risks, including legal, regulatory, currency and economic risks that are
specific to Russia. In addition, investing in Russian securities involves risks associated with the settlement of portfolio transactions and loss of the Fund’s ownership rights in its portfolio securities as a result of the
system of share registration and custody in Russia. Governments, including the U.S., the U.K., the E.U.,
and many other countries have imposed economic sanctions on certain Russian individuals and Russian
corporate and banking entities, and jurisdictions may also institute broader sanctions on Russia. Russia
has issued a number of countersanctions, some of which restrict the distribution of profits by limited
liability companies (e.g., dividends), and prohibit Russian persons from entering into transactions with designated persons from “unfriendly states” as well as the export of raw materials or
other products from Russia to certain sanctioned persons.
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Russia launched a large-scale invasion of
Ukraine on February 24, 2022. The extent and duration of the military action, resulting sanctions and
resulting future market disruptions, including declines in its stock markets and the value of the ruble against the U.S. dollar, are impossible to predict, but could be significant. Disruptions caused by Russian military action or other
actions (including cyberattacks and espionage) or resulting actual and threatened responses to such
activity, including purchasing and financing restrictions, boycotts or changes in consumer or purchaser
preferences, sanctions, import and export restrictions, tariffs or cyberattacks on the Russian government, Russian companies, or Russian individuals, including politicians, may impact Russia’s economy and Russian companies in
which the Fund invests. Actual and threatened responses to Russian military action may also impact the
markets for certain Russian commodities, such as oil and natural gas, as well as other sectors of the
Russian economy, and are likely to have collateral impacts on such sectors globally. Russian companies may be unable to pay dividends and, if they pay dividends, the Fund may be unable to receive them. As a result of sanctions, the Fund is
currently restricted from trading in Russian securities, including those in its portfolio, and the
Underlying Index has removed Russian securities. It is unknown when, or if, sanctions may be lifted or the
Fund’s ability to trade in Russian securities will resume.
Risk of Investing in the U.S. Investing in U.S. issuers subjects the Fund to legal, regulatory, political, currency, security, and economic risks that are specific to the U.S. Certain changes in the U.S., such as a weakening of the U.S. economy or a
decline in its financial markets, may have an adverse effect on U.S. issuers.
Securities Lending Risk. The Fund may engage in
securities lending. Securities lending involves the risk that the Fund may lose money because the borrower
of the loaned securities fails to return the securities in a timely manner or at all. The Fund could also
lose money in the event of a decline in the value of collateral provided for loaned securities or a decline in the value of any investments made with cash collateral. These events could also trigger adverse tax consequences for the
Fund.
Tracking Error Risk. The Fund may be subject to
“tracking error,” which is the divergence of the Fund’s performance from that of the Underlying Index. Tracking error may occur due to a number of factors, including differences between the securities
and other assets held in the Fund’s portfolio and those included in the Underlying Index; differences
in the timing and methodologies used to value securities and other assets; transaction costs and other
expenses incurred by the Fund that the Underlying Index does not incur; the Fund’s holding of uninvested cash; differences in the timing of the accrual or the valuation of dividends or interest received by the Fund or distributions paid to
Fund shareholders; tax gains or losses; the requirements for the Fund to maintain pass-through tax
treatment; portfolio transactions
carried out to minimize the distribution of capital gains to shareholders; the acceptance of custom baskets; changes to
the Underlying Index; and impacts to the Fund of complying with certain regulatory requirements or limits.
Tracking error risk may be heightened during times of increased market volatility or other unusual market
conditions.
U.S. Agency Mortgage-Backed
Securities Risk. MBS represent interests in “pools” of mortgages and are subject to interest rate, prepayment, and extension risk. MBS may be issued or guaranteed by the U.S. government or one of its agencies or sponsored entities. Some MBS may not be backed by the full
faith and credit of the U.S. government and thus represent greater credit risk. MBS react differently than
other bonds to changes in interest rates due to prepayment and extension risks. Small movements in interest
rates (both increases and decreases) may quickly and significantly reduce the value of certain MBS. MBS
prices may reflect adverse economic and market conditions. MBS are subject to the risk of default on the
underlying mortgage loans, particularly during periods of economic downturn. The default or bankruptcy of a
counterparty to a TBA transaction would expose the Fund to possible losses.
U.S. Treasury Obligations Risk. U.S. Treasury
obligations may differ from other securities in their interest rates, maturities, times of issuance and
other characteristics and may provide relatively lower returns than those of other securities. Changes in
the U.S. government’s financial condition or credit rating may cause the value of U.S. Treasury
obligations to decline. Direct obligations of the U.S. Treasury have historically involved little risk of
loss of principal if held to maturity, but the market value of such securities is not guaranteed and may fluctuate. Although U.S. Treasury obligations are backed by the full faith and credit of the United States, circumstances could arise that could
prevent the timely payment of interest or principal.
Valuation Risk. The price that the Fund could receive upon the sale (or other disposition) of a security or other asset may differ
from the Fund’s valuation of the security or other asset, particularly for securities or other assets
that trade in low volume or volatile markets or that are valued using a fair value methodology. The price
received by the Fund also may differ from the value used by the Underlying Index. In addition, the value of
the securities or other assets in the Fund’s portfolio may change on days or during time periods when
investors are not able to purchase or sell Fund shares. Authorized Participants that create or redeem Fund
shares on days when the Fund is holding fair-valued securities or other assets may receive fewer or more
shares, or lower or higher redemption proceeds, than they would have received had the securities or other
assets not been fair valued or been valued using a different methodology. The ability to value investments
may be impacted by technological issues or errors by pricing services or other third-party service providers.
S-6
Performance
Information
The performance information below illustrates how the
Fund’s performance has varied over different periods and provides some indication of the risks of investing in the Fund. The bar chart shows how the performance of the Fund
has varied from one calendar year to another over the periods shown. The table compares the Fund’s performance to that of an appropriate broad-based securities market
index and
the Underlying Index. Fund returns assume the reinvestment of any dividends and distributions. The Fund’s returns reflect the impact of any agreements to waive or reimburse expenses, which would reduce performance if not in effect. Past performance (before and after taxes) does not necessarily indicate how the Fund will perform in the future. Updated performance information, including the Fund’s current NAV, may be obtained by visiting www.iShares.com or by calling 1-800-iShares (1-800-474-2737) (toll free).
Calendar Year-by-Year Returns
| |
Return (%) |
Period Ended |
| Calendar Year-to-Date Return |
2.65% |
March 31, 2025 |
| During the periods shown in the chart:
| ||
| Best Quarter |
6.64% |
December 31, 2023 |
| Worst Quarter |
-5.87% |
March 31, 2022 |
Average Annual Total Returns
(for the periods ended December 31, 2024)
(for the periods ended December 31, 2024)
| |
One Year |
Since Fund
Inception |
| (Inception Date: 6/23/2020) |
|
|
| Return Before Taxes |
1.94% |
-1.25% |
| Return After Taxes on Distributions |
0.44% |
-2.19% |
| Return After Taxes on Distributions and Sale of Fund Shares |
1.14% |
-1.34% |
| Bloomberg U.S. Universal Index1 (Returns do not reflect deductions for
fees, expenses or taxes) |
2.04% |
-1.01% |
| Bloomberg MSCI US Universal Choice ESG Screened Index (Returns do
not reflect deductions for fees, expenses or taxes) |
1.99% |
-1.12% |
1The Fund has added this broad-based index in response to new regulatory requirements.
After-tax returns in the table above are calculated using the historical highest individual U.S. federal marginal income tax rates and do not reflect the impact of state or local taxes. Actual after-tax returns depend on an investor’s tax situation and may differ from those shown, and after-tax returns shown are not relevant to tax-exempt investors or investors who hold shares through tax-deferred arrangements, such as 401(k) plans or individual retirement accounts (“IRAs”). Fund returns after taxes on
distributions and sales of Fund shares are calculated assuming that an investor has sufficient capital gains of the same character from other investments to offset any capital
losses from the sales of Fund shares. As a result, Fund returns after taxes on distributions and sales of Fund shares may exceed Fund returns before taxes and/or returns after taxes on distributions.
S-7
Management
Investment Adviser. BlackRock Fund Advisors.
Portfolio Managers. Jonathan Graves, James Mauro and Marcus Tom (the “Portfolio Managers”) are primarily responsible for the
day-to-day management of the Fund. Each Portfolio Manager supervises a portfolio management team. Mr.
Graves, Mr. Mauro and Mr. Tom have been Portfolio Managers of the Fund since 2025, 2020 and 2025
respectively.
Purchase and Sale of Fund
Shares
The Fund is an ETF. Individual shares of the Fund may only be
bought and sold in the secondary market through a broker-dealer. Because ETF shares trade at market prices
rather than at NAV, shares may trade at a price greater than NAV (a premium) or less than NAV (a discount).
An investor may incur costs attributable to the difference between the highest price a buyer is willing to pay to purchase shares of the Fund (bid) and the lowest price a seller is willing to accept for shares of the Fund (ask)
when buying or selling shares in the secondary market (the “bid-ask spread”).
Tax Information
The Fund intends to make distributions that may be taxable to you as ordinary income or capital gains, unless you are
investing through a tax-deferred arrangement such as a 401(k) plan or an IRA, in which case, your
distributions generally will be taxed when withdrawn.
Payments to Broker-Dealers and Other Financial Intermediaries
If you purchase shares of the Fund through a broker-dealer or other financial intermediary (such as a bank), BFA or other related companies may pay the intermediary for marketing
activities and presentations, educational training programs, conferences, the development of technology
platforms and reporting systems or other services related to the sale or promotion of the Fund. These
payments may create a conflict of interest by influencing the broker-dealer or other intermediary and your
salesperson to recommend the Fund over another investment. Ask your salesperson or visit your financial
intermediary’s website for more information.
S-8
